China Securities Journal Golden Bull | Positive Signals Pour In:Several STAR Market Companies Project Strong Earnings Growth in the First Three Quarters

According to Wind data, as of October 18, 28 companies listed on the STAR Market had released earnings forecasts for the first three quarters of 2026.

By forecast category, the majority indicated positive earnings prospects. Thirteen companies expected a significant increase in net profit, three projected a slight increase, and six forecast a turnaround from losses to profits. In total, 22 companies expected year-on-year improvements in net profit, accounting for 78.57% of the total.

Positive Earnings Outlook Underpins Growth Momentum

Among the thirteen companies with forecast profit increases, Semight Instruments currently leads in the growth rate. The company expects net profit attributable to shareholders to reach RMB 1.9 billion to RMB 2.1 billion in the first three quarters, a year-on-year increase of 1,866% to 2,073%.The company attributed its performance to the rapid advancement of AI technologies and sustained growth in global demand for computing power, which have accelerated data center construction and sustained robust market demand in the high-speed optical communications sector.

Several companies expect their earnings for the first three quarters to at least double year on year.For example, Shanghai Fudan Microelectronics forecasts revenue of RMB 3.45 billion to RMB 3.65 billion, up 14.07% to 20.68% year on year, and net profit attributable to shareholders of RMB 950 million to RMB 1.15 billion, up 187.63% to 248.18%.The company attributed the growth to its continued commitment to technological innovation and product iteration, and ongoing efforts to expand the application scope of its products, combined with a recovery in industry conditions and rising demand from downstream customers. As a result, revenue across all product lines and the overall gross profit margin both increased.

More notably, all six companies forecasting a turnaround from losses to profits are part of the semiconductor industry chain.CXMT Corporation is expected to report the highest net profit among them, forecasting net profit of RMB 131 billion to RMB 132.5 billion for the first three quarters of 2026, compared with a loss of RMB 5.28 billion in the same period last year, marking a turnaround to profitability.

The company attributed its improved performance to the rapid growth in demand for AI computing power since the second half of 2025, which has boosted the global DRAM industry's performance. With supply falling short of demand, product prices have risen substantially.CXMT has steadily advanced capacity building, product R&D, and process technology improvement, further increasing wafer output per unit and capacity utilization, while continuing to realize economies of scale.Meanwhile, the company has optimized its operational management, actively expanded its market presence, deepened collaboration with upstream and downstream industry partners, and promoted sustained expansion of business scale.

Industry insiders noted three common features of the improved earnings performance among STAR Market companies. First, some companies have achieved profit growth significantly outpacing revenue growth, with profit elasticity driven not only by revenue expansion but also by a higher proportion of high-value-added products and economies of scale following capacity release. Second, demand in the AI computing power industry chain remains an important source of growth. Third, a number of hard-tech companies previously in the capacity ramp-up stage are gradually emerging from losses as shipments increase, with some already turning profitable.

Share Buybacks and Shareholding Increases Signal Strong Confidence

Alongside strong earnings growth, technology companies are placing greater emphasis on shareholder returns.

Share buyback and shareholding-increase activities among STAR Market companies have remained robust recently, with buyback plans being disclosed in quick succession and implementation progressing steadily.From October 16 to 18 alone, eight companies announced their latest buyback plans, including CXMT Corporation, Hygon Information Technology, and Montage Technology.

In terms of the size and implementation of buybacks, a number of companies have rolled out large-scale buyback plans, while some have continued to increase their buybacks.On the same evening that CXMT, which is in a period of substantial R&D investment, released its earnings forecast, Zhu Yiming, Chairman of the company, proposed that the company repurchase A-shares worth RMB 1 billion to RMB 2 billion. The repurchased shares are intended for employee equity incentives, employee stock ownership plans, or a reduction in registered capital.Against a backdrop of relatively limited shares available for trading, the proposal's substantial size has been interpreted by the market as a sign of management's confidence in the company's intrinsic value.

Meanwhile, some companies have made tangible progress in implementing their buyback and shareholding-increase plans.Anhui Yuanchen Environmental Protection Science & Technology announced that it had completed its buyback program over a period of four months, repurchasing 5.0509 million shares, equivalent to 3.1568% of its total share capital, for about RMB 50 million.As of October 16, Beijing Kingsoft Office Software had cumulatively repurchased 529,800 shares for about RMB 115 million.

Over a longer period, STAR Market companies have maintained active buyback and shareholding-increase activities since the third quarter. More than 40 new buyback plans have been announced, with the aggregate upper limit of intended buyback amounts approaching RMB 5 billion. Nearly 20 new shareholding-increase plans have also been announced, with the upper limit of the intended investment exceeding RMB 700 million. Certain companies have launched successive buyback plans. For example, BIWIN Storage Technology introduced two buyback plans in succession within more than two months, each with an amount of RMB 200 million to RMB 250 million.

It is worth noting that, unlike the past, a major feature of the current wave of buybacks is the marked increase in proposals initiated by company chairpersons.Some market participants said that technology companies are still willing to return value to shareholders and stabilize market expectations using their own funds or self-raised funds, even during critical periods of capacity building and technological iteration. This reflects an overall improvement in corporate governance and awareness of market capitalization management among STAR Market companies.

In terms of shareholding increases, several STAR Market companies have announced new plans.Shenzhen Newway Photomask Making disclosed that its actual controller, Du Wubing, plans to increase his shareholding by RMB 20 million to RMB 40 million using his own funds over the next 12 months.Loongson Technology announced that its controlling shareholder intends to increase its shareholding by RMB 5 million to RMB 6 million over the next six months.Jiang Kun, a director of Genew Technologies, also plans to increase his shareholding by RMB 400,000 to RMB 600,000 over the next six months.